Portland Business Law Blog

Overview of franchising agreements

One way a Portland entrepreneur may wish to start a business by purchasing a franchise. While the popularity of franchising began with the dawn of fast food restaurants, a number of industries here in Oregon and throughout the Pacific Northwest now rely on this model for distributing their products and services.

Basically, a local businessowner, or franchisee, will buy the rights to use the name, goods and services of a business. In exchange, the franchisee must agree to adhere to the standards of the franchisor, that is, the business which is allowing the local owner to use the larger operation's brand and products.

Important terms in a commercial lease agreement

Many business owners in the Portland area may for a number of reasons choose to lease space for their businesses instead of buying a commercial property outright. On many occasions, this is actually a smart business decision which fits in well with an owner's overall plan.

However, in order to keep a commercial lease from turning in to a major legal and financial headache, it is important that a would-be tenant, or landlord for that matter, consider several important terms that really should be addressed in every commercial lease.

What compensation can you pursue in a breach of contract case?

Drafting a sound contract for everything from a partnership agreement to a commercial lease to a licensing agreement can be critical for your business. However, even the strongest of contracts can fail to prevent a violation that forces your business to take legal action.

A breach of contract can lead to serious financial, operational and logistical setbacks for your Portland business. In such cases, Oregon business owners can seek remedies for the breach in court to correct the damage incurred from the breaching party. There are four main categories of damages or compensation to correct the breach, including:

Legal errors getting more costly over time

For a number of reasons, legal mistakes by attorneys are costing more as time goes on.

According to a relatively recent study, which is current through 2017, the number of legal malpractice claims across the country has remained stable or even declined in recent years, with many legal malpractice insurance companies reporting a consistent or a lower volume of claims.

How well-considered legal input can contribute to business success

Oregon business principals in Portland and across the state are typically proactive, creative and forward-looking individuals. They have to be, given the parameters of the American commercial universe.

Business beckons all kinds of people, but puts a high bar on success. The realm is replete with both challenges and opportunities. Would-be entrepreneurs who fail to resolutely do their homework from the outset of their business plan will likely succumb to the former. Those who faithfully do their due diligence, and continue to implement smart strategies as their ideas bear fruit, are often able to profitably exploit the latter.

Portland-area business owners have a lot to think about

The Portland area is known for having a lot of creative people who are willing to be adventurous and try their ideas out in the world of business. However great the idea may be, however, it can be very easy for an aspiring businessman to get lost in all the legal details involved with starting and running a company.

For instance, a beginning entrepreneur first has to decide what sort of business structure she wants to set up. In some cases, a partnership or limited liability company might be the best route, while other situations make a corporation a better choice for organizing one's business.

Land use issues can derail a commercial project

Like other cities across Oregon, the City of Portland has laws and regulations that govern how property owners are allowed to use their property. In theory, these laws help promote a clean, safe and efficient city.

However, if there is a drawback, it is that these land use and zoning laws can stymie a business project even before it gets off the ground. After all, owners of commercial real estate in the area must follow these laws. If they try instead to skirt around them, it is possible that they will face significant fines and other penalties, including court injunctions that will effectively shut down their businesses.

What is a breach of fiduciary duty?

Businesses in Portland, Oregon, depend heavily on trust. At least to some extent, organizations have to trust each other when entering agreements, as no one would enter a contract if they thought the other party had no chance of following it. Likewise, businesses have to trust their employees to do their jobs.

There are some relationships in the world of business, however, where trust is so important that the law offers special protection to those in the relationship, perhaps because they are counting on being able to trust the other person. The law calls these fiduciary relationships.

For Portland businesses, a lost case is not a lost cause

Business owners and individuals in the Portland area and throughout the rest of Oregon rely on their lawyers to protect their rights and interests. Sometimes, this means the lawyer will represent the business owner in a dispute or important negotiation. These matters are often critical to the life of a business and, in some cases, can be the difference between success and growth and economic hardship or even failure.

While not even the best lawyers can guarantee that things will always go as hoped for, sometimes, it will become quite apparent that the lawyer who represented the business was just not up to the task. There are, after all, a lot of details skilled legal professionals must manage in a dispute. Missing these details can tank an otherwise good case.

Are franchise contracts negotiable?

Franchise agreements, by their very nature, are meant to be standard. These “adhesion contracts” are built so they can be used by one franchisor in business with many franchisees.

The franchisor has an incentive to keep the brand and product as uniform as possible, and that incentive goes all the way to the initial contract. Contract variations work against uniformity.

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